Prop. 32 takes aim at campaign funds

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The November election will bring a third attempt to curb the political power of unions in California.

Proposition 32 would ban the use of payroll deductions for political purposes in state campaigns, eliminating a tool that has made organized labor a major donor to Democrats for decades.

This time, unlike earlier failed attempts in 2005 and 1995, proponents say they're going after corporate money as well. Their proposal would ban all union and corporate contributions to candidates.

However, it would do nothing to regulate contributions to ballot measures or independent expenditures – spending that is uncontrolled by a candidate or ballot measure committee. In California, those have been unlimited for years.

“People in California know their government is broken,” said former Democratic state Sen. Gloria Romero of Los Angeles, who signed the ballot argument for Prop. 32. “We need to curb and reduce the ties that bind politicians to special interests.”

Not so fast, said Chris Carson of the League of Women Voters. She said the measure strips unions of power while leaving business interests unscathed.

“In California virtually no corporations use payroll deductions to finance political contributions,” Carson said. By banning payroll deductions for political purposes “you prevent millions of Californians from speaking out.”

While the initiative would strip unions of their main source of funding for ballot measures and independent expenditures, corporations could continue to use their treasuries.

The measure already has drawn some $50 million in contributions – more than any other initiative on the ballot. That total could easily double by Election Day.

Romero and other backers say Prop. 32 would align California with federal law, which has long blocked direct corporate or union contributions to candidates.

In 2010 alone, direct union and corporate donations to legislative and statewide candidates totaled $70.9 million, according to figures compiled by the Yes-on-32 campaign.

“We can never outlaw independent expenditures,” Romero said. “This is what we can do right now.”

It's not enough, said Carson of the League of Women Voters. True campaign finance reform should seek a “level playing field,” she said.

“What you don't do is to enact a law that would stop one group from making campaign contributions at all while letting other groups make contributions,” Carson said. “It's just not fair.”

It's unclear, however, whether corporations would exploit that advantage.

While corporations have been big players in California ballot initiatives, they have avoided making independent expenditures in partisan races. Among the 12 groups that spent $3 million or more on independent expenditures in California between 2006 and 2012, not one was a corporation, according to the nonprofit National Institute on Money and Politics.

Romero argued that 32 will bring “a culture change,” both to Sacramento and to unions.

“They know that if 32 passes, they've got to look at their members in the white of their eyes and ask their members to contribute,” Romero said.

A psychology professor at Cal State Los Angeles and a member of the California Faculty Association, Romero clashed frequently with unions during her years in the legislature. The California Teachers Association endorsed her successful opponent, Tom Torlakson, during the 2010 race for state schools superintendent.

So far public employee unions led by the California Teachers Association and Service Employees International Union have outraised proponents by about 4-to-1.

But that could change quickly.

A key backer, Berkshire Hathaway heir Charles Munger Jr., has donated $10 million in the past two weeks to an outside group, the Small Business Action PAC, that has begun running ads in favor of 32.

And the official Yes on 32 committee just got $4 million from American Future Fund, a so-called dark money group that does not have to disclose its donors.

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